THE private healthcare businesses are becoming less capital-intensive. While they needed heavy investments typically into the real estate space and the building of their facilities in the past, the advent of digital healthcare services is changing that to some extent.

       Digital healthcare has been pushed into the forefront especially with the Covid-19 pandemic, where patient safety becomes a priority.The broad scope of digital health includes categories such as mobile health, health information technology, wearable devices, telehealth and telemedicine, and personalised medicine. Industry players say this trend could lead to lower costs as investments become less capital intensive.

       “There is an overwhelming trend that points to digital solutions entering the (healthcare) space to disrupt some level of current services. We don’t know yet how the disruption will look like,” IHH Healthcare Bhd’s group chief financial officer Joerg Ayrle said at a recent webinar titled: Emerging healthcare trends in a post-Covid world.

       IHH, which is the largest public listed private healthcare group in Asia, will place more emphasis on this growing digital healthcare space moving forward.

       Its recent investment into digital healthcare platform Doctor Anywhere (DA) appears to just be the start of how things would develop on this front. Its investment into DA is a follow-on investment in an earlier Series C fundraising. IHH’s investment into DA was first made last March, in the latter’s series B funding round. DA enables IHH to offer tele-consultations by specialists from four of IHH’s hospitals in Singapore: Gleneagles, Mount Elizabeth, Mount Elizabeth Novena, and Parkway East.

       “Users on DA’s platform will be the first to enjoy affordable medical advice and second opinion consultations by IHH Singapore specialists for sought after specialties such as orthopaedics, gastroenterology and general surgery. In time to come, more specialties such as cardiology and oncology will be added to the platform,” IHH says in a statement.IHH managing director and chief executive officer Dr Kelvin Loh says that this expanded investment into DA will help complement and integrate its brick-and-mortar operations with digital services. It will also lead to seamless and cost-effective care wherever they are situated, he adds.

       Heart centre at Pantai KL Hospital.

       The group, which is earmarking US$100mil (RM417.9mil) in capital expenditure or capex for digital healthcare initiatives in the next three years, anticipates that this is just the start of things to come.

       Partner at McKinsey & Company Sachin Chaudhary says that digital healthcare has been attracting a lot of private capital in recent years.

       “We have done work on this space with various players and the returns of investments (ROIs) of digital interventions we looked at have been even more than the other ideas that are in the pipeline. In both instances the ROIs are very attractive: whether these initiatives are enablers in the existing business to provide better care or whether they are anchored around to build a new type of business,” Chaudhary says.

       “Investors are going aggressively into this, and there is some US$14bil (RM59bil) of venture capital money that has gone into this in the recent past and it is almost double from the previous years. It points to one thing, that there is value to be generated here,” he adds.

       The digital healthcare industry globally is expected to grow to a US$600bil (RM2.5 trillion) revenue market by 2024.

       Within IHH, Loh says that the evolution in the industry is also presenting some changes that it had to cope with.

       “We have an innovation office: it is a small team now. Their job is to help facilitate innovation in the group. There were many great ideas from a recent challenge workshop on how to improve healthcare delivery to patients (using technology),” Loh says.

       On a related matter, Chaudhary notes that many hospital groups are waking up to the changing landscape of their industry.

       “A lot of hospital companies are still trying to grapple with this – ‘we are not a technology company and what should they do now?’ But the reality is that if they don’t do it, then somebody would. And there are examples in some countries that some companies are indeed building these capabilities,” Chaudhary says.

       To build up its digital capabilities, IHH is adding new capabilities beyond the traditional means of how private healthcare is usually delivered.

       This would also involve the training of clinical staff in order to equip them with skills and digital capabilities, the hospital group says.

       “We will start to deliver care beyond the hospital walls. We have to ensure there is a seamless transition that’s enabled. To me, there will be no such scenario where all care gets transferred out of the hospital walls. This is not going to happen but some of the care can. These include repeat consultations, some early triage, prescription refills and information management for trends or maybe even remote monitoring,” Loh says.

       “These are the things that can be done safely outside the hospital walls. The patient will get better care and better value. It will help us also to serve more patients to create a hospital without walls,” he adds.